Over the last couple years I loved to ridicule all the scaremongers who always said this, that or the other thing is "the worst since the Great Depression." I stand by my ridicule, for the most part -- those prophets of doom were mostly broken clocks who look right now just by sheer luck. But there's no question now that things have gotten quite bad in the economy and the markets.
So let me do the preachers of Armageddon one better. Today's stock market isn't just the "worst since the Great Depression," like they're so fond of saying. No, it's even worse than the Great Depression.
Take a look at the chart, below. It shows the daily progress of the S&P 500 in terms of percentage change from the very top. The brown line is the change from the recent all-time highs on October 9, 2007. The blue line is the change from the all-time highs just before the Great Depression, September 6, 1929.
click on the image to see it full size
As of yesterday's close (Thursday, March 5), the S&P 500 has lost 56.4% from its all-time highs 513 days ago. At the same point in the bear market associated with the Great Depression, that is at the 513 day mark, the S&P 500 had only lost -- only! -- 49%.
In other words, to be no worse than the catastrophe that happened to stocks in the Great Depression, the S&P 500 today would have to rally 17%.
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